Do you know what’s fun and free? Dreaming BIG! As kids, we use to daydream all the time. I fantasized about being a professional tennis player who’d compete in tournaments around the world via a private jet until I realized I couldn’t even make it to All-State, just All-District. It was only until the age of 32 did I start dreaming again.

When Ariana Huffington sold The Huffington Post to AOL for $315 million in 2013, The Smoking Gun, and several other sites reported that Ariana only received $21 million, or ~6.6% from the sale. $21 million isn’t chump change, but that’s a far cry from the original sale price.

Meanwhile, Michael Arrington, founder of TechCrunch sold his site to AOL in 2010 for only $40 million (includes incentives). 2010 was a bad time to sell anything – stocks, real estate, businesses, you name it. But because he owned an estimated ~80% of the site, Mike walked away with around $32 million, or 50% more than Ariana even though TechCrunch sold for 85% less than HuffPo!

It’s amazing how two vastly different sales prices can result in two surprisingly different windfalls due to company ownership structures. It often takes an army of employees and capital to build something massive. I’m not looking for fame, but I’m starting to wonder whether it’s time to once again rekindle the dreams of great fortune.

Whether you know it or not, you the FS community, is instrumental in the continued content production here. I struggled for years not wanting to do anything but travel and play because years ago I finally found “enough.” But thanks to your continued support and encouragement, I’ve kept on going. People keep asking whether I will ever run out of material to write. The answer is always “never,” because there’s an endless amount of things to talk about. If you can speak forever, you can write forever.

A new adventure on Financial Samurai may begin by the end of 2015, and I’d love to get your input once more. I’ve been seriously thinking about this topic since the beginning of the year. In fact, I’ve been sitting on this post since January, going through things in my head.

A detailed rental lease agreement is imperative for both landlords and renters alike to minimize headaches down the road. The more thorough the lease to account for any issues that may arise, the better.

I’ve spent the past 10 years refining my residential lease agreement based on all past experiences. Now my residential lease agreement is posted here for all to use at your own discretion. Feel free to run it by a lawyer or other property professionals before use, and make suggestions on how to make it even better.

There’s always a feeling of excitement on both ends when a lease is first signed. Both parties go in with a leap of faith, hoping everything will work out. But conflict is inevitable in any sort of relationship. “Understandings” that are agreed upon with a handshake tend to mean nothing if they aren’t written out when problems arise.

As a Financial Samurai landlord, your goal is to achieve maximum tenant occupancy with minimum ongoing headaches in order to enjoy your freedom. Freedom is what having money is all about. If one of your assets is giving you more headache than freedom, then something must change.

Provide a good product with good service and clear terms, and I’m confident you will reap great benefits down the road.

Back in 2001, I rented a crappy two bedroom, one bathroom apartment at the edge of Chinatown in San Francisco. The garbage truck would wake us the hell up at 4:30am twice a week. The paper mache walls couldn’t deaden the incessant arguing sounds of our Cantonese neighbors.

At $1,800 a month for two, the rent was cheap compared to the $2,100 a month studio + alcove apartment I rented with a colleague in Manhattan earlier. $300 less a month and 25% more space. What a steal in the world’s cheapest international city.

Unfortunately, I think my roommate was a little schizophrenic. About once a week at around 10pm, I’d hear his head banging on the wall as he screamed nonsense for about 30 minutes in a row. I was too afraid to see if anything was wrong so I stayed in my room.

One evening, my roommate came home from his night shift at In N’ Out Burger all bloodied. He had been whacked in the head with a bottle by assailants who stole his wallet as he traversed the Tenderloin district, at that time, the most dangerous neighborhood in San Francisco.

The trail of blood he left on our hallway floor jolted me into making a lifestyle change. Was the sacrifice to save as much money as possible putting me in danger?

Pop the champagne! I recently celebrated my 10 year anniversary of being a landlord. There have been plenty of headaches along the way, but I realized everything is fixable with time, money, and compromise.

The one thing I’m very proud of is going 120 consecutive months without a single vacant month for my first rental. I’m on my fourth master tenant, and so far so good. The rent started off at $2,150 in June, 2005 and is now at $4,000 with this latest one year rental renewal. If all goes to hell, perhaps I can find a job as a rental property manager!

I also started renting out a single family home in June 2014 after purchasing my latest house. This rental has proved to be a challenge in its first year given the higher price point of the house, and the multiple roommate scenario. One had a dog who damaged several doors and cabinet sidings. One tenant needed to break the lease early for a job move. But in the end, it all worked out thanks to a lot of scrambling.

As a landlord on a quest to achieve financial freedom, your goal is to maximize rental income and minimize costs. One month of vacancy will cut your annual income by 8.4%. Two months of vacancy will cut your annual rental income by 17%. And if you’re at three months of vacancy or more per year, you might as well hang up your boots or hire a property manager because you are doing a piss poor job being a landlord!

As I discovered in my mortgage refinance rejection, banks ascribe a 25% discount to all rental income when calculating your debt to income ratio. In other words, banks have a default assumption that each landlord will on average, have three months of vacancy. Banks were crushed during the mortgage default crisis, hence it’s hard for anybody to blame banks for being so conservative. But if you’re reading this post, you won’t be any typical landlord. You will be a Financial Samurai landlord!

Reddit recently hosted an Ask Me Anything (AMA) session with Hardeep Walia, Founder and CEO of Motif Investing, and former SEC Chairman (1993-2001) and Motif Investing Board Member, Arthur Levitt. There were some pretty interesting exchanges that I thought were worth highlighting for anybody who uses Motif Investing and who is interested in investing as a whole.

Topics of discussion include:

* International expansion plans for Motif

* Views on mutual funds and bond funds

* How much money Arthur Levitt has in his checking account

* How can the middle class navigate the investing landscape better

* Thoughts on high frequency trading, Bitcoin, Vanguard, the SEC, and 401k regulation

When asked about career advice, I always recommend people just follow the money. New York City has all the financial firms. San Francisco has all the tech, internet, and venture capital money. While Washington DC and the surrounding suburbs have all of our tax money to spend on massive government contracts!

I’ve lived in all three areas for extended periods of time, and I’ve seen massive fortunes made in multiple ways. If you want to “get lucky,” then you might as well go where there’s opportunity. Because twiddling your thumbs in a dying town, complaining why you can’t get ahead doesn’t make sense when you live in a free country with no state border controls.

The biggest push back I get for my “follow the money” advice is that such places are just so damn expensive. It is absurd that the median rent in San Francisco is now around $4,000 a month. But the only reason why rent is $4,000 a month is because incomes are high enough to afford such levels! If there weren’t, rent would fall.

The market is efficient. Capital is fluid. Everything is rational. Only an idiot with an online business would NOT try and geo-arbitrage his way to a lower cost area of the world. Oh wait, that’s me.

Before leaving for Asia I told myself I’d live it up by staying at only the finest 5-star hotels. Compared to America, Asia ex-Japan is relatively cheap. I had just finished paying down $100,000 in mortgage debt seven months earlier than expected and felt like I deserved to be rewarded. Billing 60 hours a week for three months in a row as a consultant in order to expedite my mortgage payoff was also the antithesis of being an “early retiree.”

All excited to start booking my hotels, I clicked the 5-star only search option on Hotels.comfor Seoul and Kuala Lumpur. But instead of booking four nights at the Shilla Hotel in Seoul for $350 a night, I decided to book the Centermark Hotel in Insadong for only $120 a night after taxes and fees. The Centermark Hotel was rated four stars and had free wifi. It was walking distance to all the major palaces and the Buchchon village. A $1,320 savings could easily pay for all food, transportation, and attraction tickets while in South Korea!

Then it was Kuala Lumpur’s turn to book a hotel. Originally I was going to stay at Villa Samadhi, a 5-star resort in the heart of Ampang where I used to live as a kid. The hotel looks like an oasis, perfect for a honeymoon retreat. At $250 a night for a suite with a private pool, breakfast, and wifi, it’s pretty good value compared to the prices you’d find for a similar suite in San Francisco.

But here’s the thing. My personal finance brain took over. The GDP per capita in Malaysia is only about $24,500 vs. $35,400 for South Korea and $78,000 for San Francisco! What business do I have spending $250 a night for a 5-star hotel in Malaysia as that would be equivalent to spending around $850 a night in San Francisco, something I’d never do! Instead of booking Villa Samadhi for $250 a night, I decided to book the four-star Impiana Hotel in KLCC for $120 a night. It just felt right.

There’s a debate going on between Charles Schwab, who recently launched its Charles Schwab Intelligent Advisors service (robo-advisor), and robo-advisors, Wealthfront and Betterment about whether Charles Schwab’s robo-advisor service really is free. Because Charles Schwab wrote that it will recommend a 8-30% cash weighting for its clients depending on market conditions, Wealthfront and Betterment have gone on the offensive to point out that investing such a huge weighting in cash is not only costly in a hypothetical market return scenario, but irresponsible as well.

Charles Schwab can make money off its client’s cash by paying practically no interest, and reinvesting the cash in higher income producing investments. In other words, Charles Schwab can act like a bank, with a much lower funding cost. This may come as a surprise to many, but those who know how the finance industry works know it’s a simple spread business. The more money that can be cheaply procured, the more money can be deployed for hopefully higher profits.

It’s good that Wealthfront and Betterment have pointed out how Charles Schwab can actually make money from its free robo-advisory product. But here’s the thing, when was there ever a free lunch? Furthermore, although Wealthfront and Betterment keep their clients fully invested at all times, Betterment still charges a 0.15% – 0.35% fee and Wealthfront charges 0.25% on money after $10,000. There are also underlying ETF fees, averaging ~0.15%, which the client ultimately pays for their robo-advisors to build their portfolios.

Charles Schwab is charging 0.00% in fees for their robo-advisory service. Yes, if Charles Schwab also charged a 0.15% – 0.35% fee to manage money like Wealthfront and Betterment, while recommending 8%-30% cash, that would be odd. But Charles Schwab isn’t.

Let’s not debate which business model is better. Instead, let’s discuss whether cash can be considered an investment through a logical discussion.

Note: All proceeds after expenses goes to a charity focused on keeping kids off the streets and in the classrooms. Thanks for your support!

After six years of writing over 1,000 personal finance articles, I’ve compiled 35 of the best Financial Samurai articles into one eBook to help you achieve financial independence sooner, rather than later. Financial Samurai is one of the largest personal finance sites with roughly one million organic pageviews a month. I write from experience as someone who received his MBA from UC Berkeley, spent 13 years in the financial world as an Executive Director at a couple major investment banks, and retired from Corporate America at the age of 34 with a very healthy financial nut to focus on living life on my own terms.

For some reason, there is a dearth of personal finance education in our school system. Yet, what is more important than securing our financial future? The goal of the book is to empower you with the knowledge to make better financial decisions. I’ve learned from my money mistakes (e.g. 401k, job, real estate mistakes) to help you avoid the same land mines. Money can be intimidating, but it shouldn’t be so complicated as to cause paralysis.

For long-time readers, the book acts as a terrific reference guide to review some of the most important personal finance topics in one place. You can even purchase the book for a friend or loved one as a gift. For new readers, The Best Of Financial Samurai will teach you new financial concepts and new ways of thinking to solidify your financial future. Many of the articles have been featured in major publications such as The LA Times, Kiplinger, The Wall Street Journal, The Chicago Tribune, and more.

I’ve written a pretty detailed post about analyzing whether it’s better to invest in stocks or real estate. Check it out if you’re wondering where to put your money. I tried to be unbiased in my analysis, but due to my experience investing in both asset classes for over a decade, I came to the conclusion that real estate was my preferred choice to building wealth.

Once acquired, real estate is pretty straightforward. Maximize rent, minimize expenses, let inflation take its course, and keep tenant turnover to a minimum. You are the King or Queen of your asset. Stocks, on the other hand, require constant re-balancing, trust in management, trust in a fund manager if you buy an active fund, and careful analysis of competitive forces that may hurt your investment. Think about how many great companies have disappeared over the years. This is why I recommend keeping most of your equity investments in low-cost index funds and focus on asset allocation instead.

One commenter pointed out the reason why I prefer real estate is because I was lucky to have bought in San Francisco in 2003. In this post, I’d like to address his beliefs and see if we can all just get lucky with our investments. After all, it’s always better to be lucky than good!

PRIVACY: We will never disclose or sell your email address or any of your data from this site. We do highly welcome posts and community interaction, and registering is simply part of the posting system.DISCLAIMER: Financial Samurai exists to thought provoke and learn from the community. Your decisions are yours alone and we are in no way responsible for your actions. Stay on the righteous path and think long and hard before making any financial transaction! Disclosures